Issuing changes to its tariff order and interconnection regulations, the Telecom Regulatory Authority of India has announced a cap of Rs 19 for a channel to be part of a bouquet, and channels exceeding this price must be offered separately with no limit on their MRP. This cap was earlier fixed at Rs 12.
In addition, a broadcaster cannot offer a television channel distributor a discount greater than 45 percent on a bouquet, and any discount must be based on the combined subscription numbers of that channel in à la carte and bouquet modes.
TRAI notified the amendments through a telecommunication order and the Telecommunication Regulations, 2022.
The amendments come into force on February 1, 2023 except clauses 4 and 5 which come into effect today. While clause 4 mandates informing TRAI of changes in bouquets, clause 5 concerns information to TRAI about any changes in fees RIO related fees.
Reference Interconnect Offers, or RIOs, are terms and conditions, including prices for different services, published by broadcasters with significant market power so that new entrants can seek interconnection and agree upon specific usage-based charges.
Broadcasters must inform TRAI of any change in name, nature, language, per month MRP, and composition and MRP of channels by December 16, and this information must also be published on their websites. To that effect, distribution platform operators, or DPOs, can also choose to revise their RIOs by December 16.
All television channel distributors must report the discounted retail price of à la carte channels and their bouquets, and the composition of bouquets of paid and free-to-air channels by January 1, 2023. They must publish this information on their websites as well.
Why price them at Rs 19?
When a channel is added to a bouquet or a pack, usually, the price of the pack is lower than the combined prices of individual channels on an à la carte basis. In its consultation, TRAI had found that most of the popular channels, such as those for general entertainment, sports and movies, were priced above Rs 12 per month, and because of this, subscribers had to pay the higher, à la carte rates to get access to them.
Before November 2021, 28 percent of 330 paid channels were priced above Rs 12 and only three above Rs 19. When the broadcasters published their revised tariffs in November 2021 in their RIOs after the high courts of Bombay and Kerala largely upheld the validity of the New Regulatory Framework 2020, only 20 percent of the 353 paid channels were priced above Rs 12 but 53 channels were priced above Rs 19, a whopping surge.
By increasing this price to Rs 19 per month, more popular channels can now be offered at a lower rate to subscribers via channel packs. However, the opposite could also happen as the broadcasters may increase the prices of all other channels.
TRAI had held consultations on discounts and ceiling prices for bouquets, and the discounts that broadcasters could offer to distribution platform operators in addition to a distribution fee.